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5 Ecommerce KPIs We Always Keep An Eye On

Running an online store can feel like spinning plates sometimes, trying to keep everything in check. But you know what really helps? Key performance indicators, or KPIs for short.

So, as the month comes to an end, it's time to check how your online store is doing. But with so much data to sift through, it can be overwhelming to know which numbers really matter. 

When deciding which stats to focus on for your online business, it's important to look at both the costs and the returns. That means keeping an eye on how much it costs you to acquire customers, as well as how much money you're bringing in and whether your customers are happy.

To simplify things, here are the five most important things you should be keeping track of to gauge the health of your online business. 

Revenue and Sales

Tracking your business's revenue and sales performance helps you understand how much money you're making and which products are bringing in the most cash, and when. To get a clear picture of your earnings, it's smart to gather data from your billing software and combine it with info from your retail analytics software.

Here are some key metrics to keep an eye on:

Average Order Value (AOV): This tells you the average amount customers spend each time they make a purchase. It helps you figure out things like how much to charge for shipping. 

For instance, if your AOV is high, you can likely afford to offer discounted or even free shipping. But if it's lower, you might need to adjust your shipping charges or drive your efforts towards bundle purchases to increase AOV.

Conversion Rate (CVR): CVR measures the percentage of website visitors who take a desired action, such as making a purchase, filling out a form, signing up for a subscription, or clicking on an ad. 

The specific goal of conversion can vary depending on the objectives of the business or individual. For example, businesses focused on lead generation may track the percentage of visitors who fill out a contact form, while those aiming to grow their subscriber base monitor sign-up rates for newsletters. 

Similarly, for those prioritizing website traffic, conversion rate might represent engagement metrics like pages per visit or time spent on site. In e-commerce, conversion rate typically measures the percentage of visitors who make a purchase. Overall, CVR is a measure of how successful your efforts are in achieving specific goals.

Website Performance and User Engagement

Your website is the first thing people see online. You want to make a good impression. But that's a topic for another day. 

What we're trying to say is, just as people might walk out of a store if they don't like the atmosphere, they might leave your website if it's not running smoothly. To see if it's attracting customers and making sales, here are some things to keep an eye on:

Website Traffic: This is the number of people who visit your online store within a certain period. It's important because generally, more visitors mean more potential sales. 

However, while increased traffic is positive, it's pointless if visitors aren't converting into customers. If you notice high traffic but low sales, it's a sign to audit your website. 

Perhaps there are issues with the checkout process, problems with your payment gateway, or other barriers preventing conversions.

Pageviews per Session: This tells you how many pages someone looks at during one visit to your site. If it's too high, it might mean your website is hard to navigate, and if it's too low, people might not be exploring enough. 

Bounce Rates: This shows how many people leave your site quickly after arriving. A high bounce rate could mean there's something wrong with your site, like it's too slow or confusing, or maybe your content isn't grabbing their attention.

Marketing and Advertising

We all know digital marketing and advertising rely heavily on data, making it easy to track their performance. Here are some important metrics we always keep an eye on:

Referral Sources: You need to know where your sales are coming from. Monitoring referral sources helps you see which platforms, channels, and partners are bringing in the most revenue, and which ones could use improvement.

Pay Per Click (PPC): If you're running ads with a pay-per-click model, tracking PPC rates shows you how much you're spending on ads and whether they're effective in bringing in customers.

Average Position: This tells you where your website ranks on search engine results pages (SERPs). A higher position means your SEO efforts are paying off, while a lower one indicates room for improvement.

Return On Ad Spend (ROAS): ROAS shows you how much revenue you've generated compared to the amount you've spent on advertising. It helps you assess the effectiveness of your ad campaigns and overall marketing strategies.

Cost Per Result: This metric shows how much you're spending to achieve a specific outcome, such as a sale, lead, or website visit. Keeping an eye on cost per result helps you optimize your advertising budget and ensure you're getting the most value out of your marketing efforts.

Customer Acquisition and Retention

These key performance indicators (KPIs) can reveal a lot about how your customers perceive your brand. For instance, if you're losing customers regularly, it might mean your product needs fixing or you need to work on building stronger customer loyalty.

Here are some metrics to keep an eye on for both acquiring and keeping customers:

Customer Lifetime Value (CLV): This is how much value a customer brings to your business over their entire relationship with you. Monitoring CLV helps you understand how loyal your customers are and where to focus your efforts to keep them coming back.

Customer Acquisition Cost (CAC): CAC shows you how much it costs, on average, to get a new customer. It helps you figure out if you should invest more in things like advertising or lead generation to bring in new customers.

The formula for calculating Customer Acquisition Cost (CAC) is:

CAC = Total Cost of Sales and Marketing Efforts / Number of New Customers Acquired

For example, if you spent $10,000 on sales and marketing efforts in a month and acquired 100 new customers during that same period:

CAC = $10,000 / 100 = $100 per new customer

This means it costs you $100 on average to acquire each new customer during that month.

Churn Rate: This measures how quickly customers are leaving your brand, canceling subscriptions, or stopping using your service. Keeping an eye on churn rate gives you a sense of how well you're retaining customers and whether you need to make improvements to keep them around.

Here’s how you calculate churn rate:

Churn Rate = (Number of Customers Lost during a Given Period / Total Number of Customers at the Beginning of the Period) * 100

For example, if you start with 100 customers and lose 10 of them over a month:

Churn Rate = (10 / 100) * 100 = 10%

This means your churn rate for that month is 10%, indicating that 10% of your customer base churned or stopped using your service during that period.

Customer Satisfaction

Customer satisfaction and customer service go hand in hand. Your customer satisfaction metrics can tell you a lot about how well your customer service is doing and whether your product is meeting expectations. Similarly, your customer service metrics can give insights into overall customer satisfaction.

Here are some important ones to keep an eye on:

Complaint Rate: This tells you how many complaints you're getting, whether it's about specific issues, from certain groups of customers, or just in general. Monitoring complaints closely helps you understand where you need to improve both your customer satisfaction and your services.

Return Rate (RR): If a lot of customers are returning a product, it usually means it's not meeting their expectations. High return rates indicate a gap between what customers want and what they're getting.

Reviews: Looking at the ratio of positive to negative reviews gives you an overall sense of how happy your customers are with your products and service. Reading through reviews in detail can provide more insights into what's working well and what needs improvement.

Final Words

To sum it all up, paying attention to these key performance indicators (KPIs) is absolutely important for the growth of your online business. 

Imagine running a marathon without keeping track of your time or distance – you'd have no idea how you're doing or where you need to improve, right? Well, it's kind of the same with your ecommerce store.

If you stay attentive and base your decisions on solid data, you're setting yourself up for success in your ecommerce business.


Well, aren’t we glad you asked! We at DigiCom are obsessive data-driven marketers pulling from multi-disciplinary strategies to unlock scale. We buy media across all platforms and placements and provide creative solutions alongside content creation, and conversion rate optimizations. We pride ourselves on your successes and will stop at nothing to help you grow.


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